Come on people are we all really going to fall for the latest noise coming out of MX Oil: LON MXO? I’ll say it again and I’ll say it loud and clear yesterdays MX Oil RNS stinks to high heaven. I do not believe in fairies and I certainly don’t believe in a Nigerian Father Christmas dishing out $18,000,000 for an asset that was bought for a lot less when the oil price was mucho far higher than it is now!
In the 25 January 2016 RNS the bullshitters running the company told us that a credible offer/buyer had come forward. Of course in my limited experience no company just pops up. So this company, whoever it is, must have been in negotiation’s for weeks if not months….. And there’ll be an evidential paper trail as such to prove thus should it all fade away….. What a ‘fortunate’ coincidence it was that they announced it when they did, bearing in mind that the MX Oil sp had gone below its 1p ‘par value’ to 0.60p and they had to seek share-holder approval to issue more confetti at a hastily convened EGM. The whisper was that they’d been running around seeking to place at 0.4/0.5. They were desperate to raise cash. In that RNS they told us all this; “The Directors believe that selling its investment on these terms, if completed, would be more attractive to shareholders than raising equity to fund its investment to first oil at the current share price.” Then they hit us with a keep the lights on placing! They raised £560,000 from a placing of 44.8 million ordinary shares at a price of 1.25 pence per share. Not including the outstanding bonds. So all in all the sleight of hand has eased off the immediate pressure.
The pump and dumpers, were out in force chatting the usual guff. Podcasts a plenty! Remember these are the same people who were telling you all how super the 4.5p premium placing was, so much oil, fantastic assets in Mexico, Africa, Frangos great guy, blah bblah blah… Well people just look at the clusterfook you’ve ended up in. Best not to re-visit for more punishment.
However the very fact that an EGM on the 18 February 2016 has now been called should red flag it for investors, who need to run a mile and dump their stock. MX Oil are seeking shareholder consent for a capital reorganisation which would permit the Company to issue new Ordinary Shares at a price below 1p, the current nominal value of each Ordinary Share. In other words there’s going to be an almighty placing sub 1p.
Take no notice of the fantasy and the porky pies coming out of Cornhill HQ. What’s the betting that the ‘Buyer’ after Due Diligence etc. etc. etc. Doesn’t complete? ‘Initially up to US$3.5 million will be advanced to the Company in two stages after the signing of binding legal documentation. These funds will be used to finance the remaining cash calls expected to be required for the investment in order to bring the underlying asset into production.’ Here’s their get out of jail clause in the 2nd February 2016 RNS. “If, for whatever reason, the purchaser decides not to exercise its acquisition right then the amount initially advanced will either be repaid converted into a convertible loan in the company holding the investment or become a secured loan to be repaid from the cash flow generated from oil production”
As for the convenient unnamed mystery buyer who appeared in a puff of smoke, I’ll bet you my last penny that they disappear just as quickly as they appeared once the smoke and mirrors and the party tricks are over. i.e. MX have fleeced more cash from the mug retail brigade. It’s chicanery. Stay well clear of this. Do what Frangos has done. Run a fooking mile and put as much distance between your selves and this POS as is humanly possible.
Viva
Dan
